January 23, 2013
The End of an Estate Planning Era
Some estate planning attorneys believe that the passage of the American Taxpayer Relief Tax Act of 2012 (ATRA) marked the end of an era. The new law made the $5 million unified credit permanent, solving most of the uncertainty that has shadowed estate planning for the past decade. The uncertainty and the possibility of the unified credit decreasing created a lucrative business for estate planners. Many taxpayers rushed to take advantage of what many considered to be a once in a lifetime offer, and lawyers worked overtime to fill that order. Now that's over. With the unified credit set at $5.25 million (after the adjustment for inflation), almost no one has to worry about the estate tax. That means that the once lucrative business is over, and attorneys in this field will probably need to re-adjust. In addition, some attorneys are beginning to feel the backlash from clients who are concerned that they gave too much in their haste to take advantage of high unified credit. Soon, attorneys will begin the process of filing gift tax returns for the past year. With all of gifting that occurred at the end of the year, it is certain that by IRS audits of those returns will likely turn up some interesting techniques that attorneys used to pack more into the unified credit. We shall see what the future holds for our profession as we move into 2013.
See Deborah L. Jacobs, Morphing Into The New Age of Estate Planning, Forbes, Jan. 15, 2013.
Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.)) for bringing this article to my attention.
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